…negligent in not objecting to the judgment debtor’s bankruptcy proceeding…

Posted on December 5, 2022 by Richard Klass

In Basile v Law Offices of Neal Brickman, P.C., 2022 NY Slip Op 06079 [1st Dept Nov. 1, 2022], the court affirmed the denial of the law firm’s motion to dismiss, holding:

The legal malpractice claim may not be barred by the three-year statute of limitations (CPLR 214[6]). Plaintiff contends that the claim was tolled by the continuous representation doctrine based on alleged emails and telephone conversations about collecting on plaintiff’s money judgment against the judgment debtor following its entry in 2010, at which time the judgment debtor did not have sufficient assets to satisfy the judgment. Defendants, however, assert that there was no continuous representation because plaintiff had no communication with them concerning collecting on the unsatisfied judgment until August 2019, when the limitations period on the instant claim had expired. These factual contentions concerning whether defendant continued to represent plaintiff during the relevant time period so as to toll the limitations period give rise to factual issues that cannot be resolved in this pre-answer motion to dismiss (see Boesky v. Levine, 193 A.D.3d 403, 147 N.Y.S.3d 2 [1st Dept. 2021]; Johnson v. Law Off. of Kenneth B. Schwartz, 145 A.D.3d 608, 612, 46 N.Y.S.3d 1 [1st Dept. 2016]).

Furthermore, the complaint’s allegations are sufficient to state a cause of action for legal malpractice. Plaintiff alleges that defendants were negligent in not objecting to the judgment debtor’s bankruptcy proceeding in 2015, which resulted in a discharge order that barred plaintiff from collecting on his money judgment against her. Defendants argue that they did not breach their duty to plaintiff by not intervening in the bankruptcy proceeding because they did not receive notice of the proceeding. Defendants submit the bankruptcy petition, which, in naming plaintiff as a creditor, included an outdated address for defendants and omitted the name of defendants’ law firm or a suite number. These undisputed facts, however, are not sufficient to find as a matter of law that defendants did not breach their duty to plaintiff. Defendants relocated to their new office in September 2014 and the judgment debtor filed her bankruptcy petition in January 2015, three months later. The bankruptcy petition included the name of the attorney who had assisted in plaintiff’s underlying action against the judgment debtor. At the very least, a factual issue exists as to whether the notice of the bankruptcy proceeding to object on plaintiff’s behalf was forwarded to defendants, which cannot be resolved at this juncture. As to proximate cause, contrary to defendants’ contention, proof of the collectability on a judgment is not an essential element of the legal malpractice claim, and arises after the “case within the case” has been proven (Lindenman v. Kreitzer, 7 A.D.3d 30, 35, 775 N.Y.S.2d 4 [1st Dept. 2004]).

Richard A. Klass, Esq.
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Richard A. Klass, Esq., maintains a law firm engaged in civil litigation at 16 Court Street, 28th Floor, Brooklyn, New York. He may be reached at (718) COURT●ST or RichKlass@courtstreetlaw.comcreate new email with any questions.

Prior results do not guarantee a similar outcome.

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Plaintiffs failed to meet their shifted burden.

Posted on November 29, 2022 by Richard Klass

In Colucci v Rzepka, 209 AD3d 1205, 1207-08 [3d Dept 2022], the court held:

“An action to recover damages arising from legal malpractice must be commenced within three years after accrual” (Zorn v. Gilbert, 8 N.Y.3d 933, 933–934, 834 N.Y.S.2d 702, 866 N.E.2d 1030 [2007] [citation omitted]; see CPLR 214[6]). In the civil context, the claim “accrues when the malpractice is committed” (Ruggiero v. Powers, 284 A.D.2d 593, 594, 725 N.Y.S.2d 759 [3d Dept. 2001], lv dismissed 97 N.Y.2d 638, 735 N.Y.S.2d 495, 760 N.E.2d 1291 [2001]), “not at the time that the injury is discovered” (Lavelle–Tomko v. Aswad & Ingraham, 191 A.D.3d 1142, 1143, 143 N.Y.S.3d 109 [3d Dept. 2021]; see McCoy v. Feinman, 99 N.Y.2d 295, 301, 755 N.Y.S.2d 693, 785 N.E.2d 714 [2002]). As the moving parties, the law firms bear the “the initial burden of demonstrating, prima facie, that the time within which to commence the action has expired” (Krog Corp. v. Vanner Group, Inc., 158 A.D.3d 914, 915, 72 N.Y.S.3d 178 [3d Dept. 2018] [internal quotation marks and citations omitted]; see Lavelle–Tomko v. Aswad & Ingraham, 191 A.D.3d at 1143–1144, 143 N.Y.S.3d 109). To that end, the law firms established that this action was brought after the three-year statute of limitations accrued inasmuch as Rzepka ceased representation of plaintiffs in December 2015 and this action was not commenced until May 2020. Thus, the burden shifted to plaintiffs “to raise a question of fact as to whether the statute of limitations has been tolled or was otherwise inapplicable, or whether the action was actually commenced within the period propounded by … defendant[s]” (State of N.Y. Workers’ Compensation Bd. v. Wang, 147 A.D.3d 104, 110, 46 N.Y.S.3d 230 [3d Dept. 2017] [internal quotation marks and citations omitted]; see Bank of Am., N.A. v. Gulnick, 170 A.D.3d 1365, 1367, 95 N.Y.S.3d 639 [3d Dept. 2019], lv denied 34 N.Y.3d 908, 2020 WL 728411 [2020]).

Plaintiffs failed to meet their shifted burden. Specifically, plaintiffs erroneously rely upon Grace v. Law, 24 N.Y.3d 203, 997 N.Y.S.2d 334, 21 N.E.3d 995 (2014) for the proposition that they were not permitted to commence this action until the appeal of the Stuyvesant Plaza action was resolved in January 2018. In Grace v. Law, the Court of Appeals held “that prior to commencing a legal malpractice action, a party who is likely to succeed on appeal of the underlying action should be required to press an appeal. However, if the client is not likely to succeed, [the client] may bring a legal malpractice action without first pursuing an appeal of the underlying action” (id. at 210, 997 N.Y.S.2d 334, 21 N.E.3d 995 [emphasis added]). Here, given Supreme Court’s “broad discretion in controlling discovery and disclosure” (Colucci v. Stuyvesant Plaza, Inc., 157 A.D.3d at 1098, 69 N.Y.S.3d 410 [internal quotation marks and citations omitted]), plaintiffs’ appeal from the Stuyvesant Plaza action was not “likely to succeed,” such that it was not necessary for them to file an appeal pursuant to the standard set forth in (Grace v. Law, 24 N.Y.3d at 210, 997 N.Y.S.2d 334, 21 N.E.3d 995; see Florists’ Mut. Ins. Co., Inc. v. Behman Hambelton, LLP, 160 A.D.3d 502, 502, 71 N.Y.S.3d 357 [1st Dept. 2018]). Thus, plaintiffs were not “forced” to file an appeal prior to commencing the legal malpractice action. If plaintiffs believed the best course of action was to also file an appeal, they were certainly free to, but this did not toll the statute of limitations. Rather, the preferable course of action would have been to both timely commence the legal malpractice action and pursue an appeal and then request a stay of the legal malpractice action until determination of the appeal (see Spitzer v. Newman, 163 A.D.3d 1026, 1027–1028, 82 N.Y.S.3d 595 [2d Dept. 2018]). Accordingly, Supreme Court did not err in granting the law firms’ motions to dismiss the complaint as untimely. In light of this determination, plaintiffs’ remaining contentions have been rendered academic.

Richard A. Klass, Esq.
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Prior results do not guarantee a similar outcome.

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Sometimes, Litigation Is Like Playing Whac-A-Mole®

Posted on October 7, 2022 by Richard Klass

We pick up and “play it again” where our Spring issue of Law Currents, “Don’t Play it Again, Sam,” left off.

To remind you, here were the facts in that article, concerning actions in 2012 and 2021.

2012 Action

In July 2012 (the “2012 Action”), the plaintiff filed suit in the Civil Court against Defendants. In the 2012 Action, the plaintiff sued for the following: “Action to recover the sum of $18,000, with interest thereon from January 1, 2009, based upon a) mistaken charge to [Plaintiff’s] credit card account by Defendants in the amount of $18,000.00, and Defendants’ failure and refusal to credit said charge back to Plaintiff; b) breach of contract; and c) unjust enrichment.”

In January 2020, after court orders marking the trial date “final,” the Civil Court Judge entered an Order dismissing the 2012 Action. At the hearing, the Court found that the plaintiff “had notice of [the] trial date since November of 2019” and thereafter denied the application for an adjournment of the trial.

2021: Second Action Filed

In March 2021, the plaintiff commenced a new action in the Supreme Court (the “2021 Action”), asserting claims against the defendants relating to a dispute regarding specific charges on his account. He also asserted claims for unjust enrichment, conversion, breach of contract, breach of implied covenant of good faith, injunctive relief, intentional infliction of emotional distress, and declaratory relief. The plaintiff specifically asserted in the complaint that two sets of credit-card charges were erroneously paid, totaling approximately $18,000. In the 2021 Action, the plaintiff’s additional causes of action arose from a nucleus of operative facts that were identical to the ones adjudicated through judgment in the 2012 Action.

Move for Dismissal of the 2021 Action Based on the Doctrine of Res Judicata

The defendants retained Richard A. Klass, Esq., Your Court Street Lawyer, to move for dismissal of the 2021 Action based on the doctrine of res judicata. Pursuant to CPLR 3211(a)(5), a cause of action should be dismissed when it “may not be maintained” due to the doctrine of res judicata (also known as “claim preclusion”). In the 2021 Action, the complaint asserted claims for the transactions that had already been adjudicated in the 2012 Action. Under New York’s “transactional analysis approach to res judicata, ‘once a claim is brought to its final conclusion, all other claims arising out of the same transaction or series of transactions are barred, even if based upon different theories or if seeking a different remedy.”’ In re Hunter, 4 N.Y.3d 260, 269 (2005).

2021 Action Dismissed

The Supreme Court Justice granted the motion to dismiss the 2021 Action. In his decision, the judge held: “The Court observes that the doctrine [of res judicata] ‘precludes litigation of matters that could or should have been raised in a prior proceeding between the parties arising from the same factual grouping, transactions or series of transactions.’ (see, DeSanto Construction Corporation v. Royal Insurance Company, 278 AD2d 357 [2nd Dept. 2000].”

Like in Whac-A-Mole, the Matter Pops Up Again.
Notice of Appeal of Civil Court Order Filed February, 2020.

As mentioned above, the Civil Court Judge dismissed the plaintiff’s 2012 Action. The plaintiff served and filed a Notice of Appeal to the Appellate Term[1], First Department. More than two years had elapsed since the plaintiff filed the Notice of Appeal and he had taken no steps to perfect his appeal.

Motion Made to Dismiss the Appeal

A motion was made to dismiss the appeal since it had not been perfected within the time prescribed by court rule; see, 22 NYCRR 640.6.[2] It was pointed out that relevant case law had held that the appeal “shall” be dismissed. Zetlin v. Hanson Holdings, Inc., 63 A.D.2d 878, 405 N.Y.S.2d 472 (1st Dept 1978) (“[U]ndue delay is presumed if the perfecting of the appeal goes beyond one year”).

The Appeal Dismissed

In the motion papers, it was urged that the appeal be dismissed because more than two years had passed. The appellate court agreed and dismissed the appeal.

Motion Brought to Renew and Reargue (Whac-A-Mole)

After the 2021 Action in the Supreme Court was dismissed, the plaintiff brought a motion to “renew and reargue” the judge’s decision, claiming that the judge was wrong for dismissing the action and should restore the case.

Motion Denied to Renew and Reargue

In denying the plaintiff’s motion, the Supreme Court Justice cited from the well-known case of Foley v. Roche, 68 A.D.2d 558 (1^st Dept. 1979), which held as to:

1) Reargument:

A motion for reargument, addressed to the discretion of the court, is designed to afford a party an opportunity to establish that the court overlooked or misapprehended the relevant facts, or misapplied any controlling principle of law. Its purpose is not to serve as a vehicle to permit the unsuccessful party to argue once again the very questions previously decided (Fosdick v Town of Hempstead, 126 N.Y. 651; American Trading Co. v Fish, 87 Misc 2d 193). Nor does reargument serve to provide a party an opportunity to advance arguments different from those tendered on the original application. It may not be employed as a device for the unsuccessful party to assume a different position inconsistent with that taken on the original motion. As was observed by the Court of Appeals in Simpson v Loehmann (21 N.Y.2d 990), “A motion for reargument is not an appropriate vehicle for raising new questions.” Moreover, were we to consider the present motion as one for reargument, it was clearly untimely, since such a motion may not be made after the time to appeal from the original order has expired (Matter of Huie [Furman], 20 N.Y.2d 568, 572; Fitzpatrick v Cook, 58 AD2d 642; Prude v County of Erie, 47 AD2d 111). To hold otherwise would permit circumvention of the prohibition against extending the time to take an appeal from the original order (see 2A Weinstein-Korn-Miller, NY Civ Prac, par 2221.03).

2) Renewal:

An application for leave to renew must be based upon additional material facts which existed at the time the prior motion was made but were not then known to the party seeking leave to renew, and, therefore, not made known to the court. Renewal should be denied where the party fails to offer a valid excuse for not submitting the additional facts upon the original application. (Ecco High Frequency Corp. v Amtorg Trading Corp., 81 NYS2d 897, affd 274 App Div 982, rearg and app den 274 App Div 1056; Matter of Holad v MVAIC, 53 Misc 2d 952; American Trading Co. v Fish, supra.) Nor should the remedy be available where a party has proceeded on one legal theory on the assumption that what has been submitted is sufficient, and thereafter sought to move again on a different legal argument merely because he was unsuccessful upon the original application.

The Supreme Court Justice held that: “The plaintiff has not established that the Court misunderstood any issue of fact or misapplied any principal of law.”

_____

Endnotes

[1] Appeals of New York City Civil Court orders and judgments are made to the Appellate Term of the Supreme Court. The First Department covers those appeals emanating from the Civil Courts for the Bronx and New York Counties.

[2] 22 NYCRR 640.6.

(a) Appeals from the Civil Court.

(1) Appellant shall procure the clerk’s return pursuant to section 1704 of the New York City Civil Court Act to be filed within 30 days after the filing of the notice of appeal.

(2) Fifteen days before the first day of each term, the clerk of the Appellate Term shall cause a calendar to be published in the New York Law Journal of all appeals in which the clerk’s return has been filed since the last publication of such a calendar. The appeals shall be listed in the order that the returns are received and the date each return was filed shall be stated. The publication of the calendar shall serve as notice to the parties of the filing of the return.

(3) Within 60 days after the filing of the return either party may notice the appeal for argument:

(i) If noticed by appellant, the appellant shall file a notice of argument at least 53 days before the first day of the term for which the appeal shall have been noticed, together with the following: proof of service thereof; five copies of the record or appendix with proof of service of one copy, if the appeal is to be heard on copies of the record or appendix; five copies of appellant’s brief with proof of service of one copy; and such exhibits or copies thereof as are not included in the record or return, unless such exhibits are in the possession of the respondent. At least 31 days before the beginning of the term, respondent shall file five copies of the answering brief with proof of service of one copy and such exhibits or copies thereof not required to be filed by appellant. Five copies of a reply brief with proof of service of one copy may be filed at least 24 days before the first day of the term for which the appeal shall have been noticed.

(ii) The respondent may notice the appeal for argument by serving and filing a notice of argument at least 68 days before the first day of the term for which respondent shall notice the appeal with proof of service. At least 53 days before the first day of the term, unless the court otherwise directs, appellant shall file five copies of appellant’s brief with proof of service of one copy of the brief. Where appellant so files, respondent may serve and file an answering brief at least 31 days before the first day of the term. If appellant fails to serve and file the brief and fails to appear on the call of the calendar, the court may affirm the judgment or order appealed from or, in its discretion, dismiss the appeal with costs upon the call of the calendar. Five copies of a reply brief with proof of service of one copy may be filed 24 days before the first day of such term.

(iii) If neither party notices the appeal for argument within the time prescribed by this section, the appeal shall be dismissed unless for good cause shown an enlargement of time is granted by the court.

Richard A. Klass, Esq.
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Prior results do not guarantee a similar outcome.

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Plaintiff failed to allege that “but for” defendant’s negligent conduct, he would have prevailed.

Posted on September 13, 2022 by Richard Klass

In Markov v Barrows, 172 NYS3d 434, 435 [1st Dept 2022], the court dismissed the legal malpractice action as follows:

Supreme Court properly dismissed plaintiff’s legal malpractice cause of action in the original complaint because he failed to allege that “but for” defendant’s negligent conduct, he would have prevailed in the underlying action (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]; 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 [2007]). Plaintiff’s citation to a ruling in the underlying action denying dismissal of his fraud claim, among others, did not, without more, show that he would have prevailed in the underlying action had defendant timely commenced it by naming the proper parties in the original complaint (see Sonnenschine v. Giacomo, 295 A.D.2d 287, 287, 744 N.Y.S.2d 396 [1st Dept. 2002]).

Further, Supreme Court providently exercised its discretion in denying plaintiff’s motion for leave to amend the complaint because the claims asserted in the proposed amended complaint are devoid of merit (see Lewis v. Pierce Bainbridge Beck Price & Hecht, LLP, 205 A.D.3d 618, 166 N.Y.S.3d 864 [1st Dept. 2022])

Richard A. Klass, Esq.
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Prior results do not guarantee a similar outcome.

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A good reminder about complying with discovery demands in litigation

Posted on August 17, 2022 by Richard Klass

Gorbatov v Tsirelman, 206 AD3d 887, 889-90 [2d Dept 2022] is a good reminder about complying with discovery demands in litigation, The court held:

“Pursuant to CPLR 3126, a court may impose discovery sanctions, including the striking of a pleading or preclusion of evidence, where a party ‘refuses to obey an order for disclosure or wilfully fails to disclose information which the court finds ought to have been disclosed’ ” (Aha Sales, Inc. v. Creative Bath Prods., Inc., 110 A.D.3d 1019, 1019, 973 N.Y.S.2d 791, quoting CPLR 3126). “If a party served with a demand for a bill of particulars willfully fails to provide particulars which the court finds ought to have been provided …, the court may make such final or conditional order with regard to the failure or refusal as is just, including such relief as is set forth in [CPLR 3126]” (CPLR 3042[d]). The nature and degree of the penalty to be imposed pursuant to CPLR 3126 is a matter within the discretion of the court (see Smookler v. Dicerbo, 166 A.D.3d 838, 839, 88 N.Y.S.3d 235). “The drastic remedy of striking a pleading is appropriate when there is a clear showing that the failure to comply with discovery demands or orders was willful and contumacious” (Henry v. Atlantis Rehabilitation & Residential Healthcare Facility, LLC, 194 A.D.3d 1021, 1022, 149 N.Y.S.3d 217; see CPLR 3126[3]; Gafarova v. Yale Realty, LLC, 174 A.D.3d 862, 863, 106 N.Y.S.3d 122). Moreover, “[t]he willful or contumacious character of a party’s conduct can be inferred from the party’s repeated failure to respond to demands or to comply with discovery orders, and the absence of a reasonable excuse for these failures, or by the failure to comply with court-ordered discovery over an extended period of time” (Nationstar Mtge., LLC v. Jackson, 192 A.D.3d 813, 815, 144 N.Y.S.3d 81 [internal quotation marks omitted]; see Henry v. Atlantis Rehabilitation & Residential Healthcare Facility, LLC, 194 A.D.3d at 1022–1023, 149 N.Y.S.3d 217).

Here, the Supreme Court providently exercised its discretion in granting those branches of the defendants’ motions which were to strike the complaint upon finding, inter alia, that the plaintiffs’ repeated disregard of the defendants’ demands for discovery and bills of particulars, the plaintiffs’ failure to provide responses to the demands despite having participated in discovery conferences wherein they stipulated to provide such responses, the plaintiffs’ inadequate responses when they did respond, and the absence of an adequate excuse for these failures constituted willful and contumacious behavior (see Sparakis v. Gozzer Corp., 177 A.D.3d 1011, 1012–1013, 113 N.Y.S.3d 272; Williams v. Suttle, 168 A.D.3d 792, 793–794, 91 N.Y.S.3d 447).

Contrary to the plaintiffs’ contention, the length of the demands for bills of particulars did not, in and of itself, make the demands oppressive or burdensome, especially in light of the length and generality of the complaint (see Singh v. Kalish, 153 A.D.2d 621, 624, 544 N.Y.S.2d 654; Malan Constr. Corp. v. Allis–Chalmers Mfg. Co., 35 A.D.2d 788, 788–789, 315 N.Y.S.2d 258). Further, to the extent that the defendants’ demands sought amplification of the complaint, they were proper (see Singh v. Kalish, 153 A.D.2d at 624, 544 N.Y.S.2d 654; Malan Constr. Corp. v. Allis–Chalmers Mfg. Co., 35 A.D.2d at 788–789, 315 N.Y.S.2d 258).

The Supreme Court also properly rejected the plaintiffs’ proffered justification that they could not respond to the defendants’ demands without the defendants’ production of the plaintiffs’ files. Although this Court recognized in a prior determination of appeals in this action that certain facts essential for the plaintiffs to make more specific allegations were in the possession of the defendants (see Gorbatov v. Tsirelman, 155 A.D.3d 836, 839, 65 N.Y.S.3d 71), the plaintiffs failed to demand such discovery until September 2018—almost a year after this Court issued that determination and months after the defendants had filed their separate motions, inter alia, to strike the complaint. The plaintiffs’ demand was made more than two years after the Tsirelman defendants’ demands, more than three years after Kucherovsky’s demands, and months after the issuance of the January 2018 and May 2018 orders directing compliance with the defendants’ demands. Moreover, the plaintiffs never moved to compel the disclosure and did not provide the defendants with any documentary disclosure at all.

Under these circumstances, the Supreme Court providently exercised its discretion in granting those branches of the defendants’ motions which were to strike the complaint (see Sparakis v. Gozzer Corp., 177 A.D.3d at 1012–1013, 113 N.Y.S.3d 272; Williams v. Suttle, 168 A.D.3d at 793–794, 91 N.Y.S.3d 447).

Richard A. Klass, Esq.
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Prior results do not guarantee a similar outcome.

R. A. Klass
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