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​EMOTIONAL AND PSYCHOLOGICAL DAMAGES, AS OPPOSED TO PECUNIARY DAMAGES, WILL NOT SUPPORT AN ACTION FOR BREACH OF FIDUCIARY DUTY (FIRST DEPT). ​

The First Department, reversing Supreme Court, determined emotional and psychological damages, as opposed to pecuniary damages, will not support an action for breach of fiduciary duty:

… [P]laintiffs proffered no evidence showing that Atesa [plaintiff] sustained pecuniary damages, and adduced proof identifying only emotional and psychological injuries. Contrary to plaintiffs’ contention, the allegations in the complaint that Atesa incurred financial expenses as a result of having to seek medical treatment and retain new counsel due to defendants’ alleged misconduct are insufficient to defeat summary judgment, absent any supporting evidentiary proof (see CPLR 3212[b] …). Plaintiffs’ contention that they could present such proof at trial is unavailing … . Because plaintiffs failed to raise a triable issue of fact as to whether recoverable damages were incurred, summary judgment dismissing the claim should have been granted … . Pacelli v Peter L. Cedeno & Assoc., PC, 2023 NY Slip Op 05448, First Dept 10-26-23

Practice Point: Emotional and psychological damages, as opposed to pecuniary damages, will not support an action for breach of fiduciary duty.

 

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PLAINTIFF IN THIS LEGAL MALPRACTICE ACTION WAS NOT REPRESENTED BY DEFENDANT ATTORNEY; PLAINTIFF ALLEGED HE WAS REQUIRED TO DEFEND A FAKE CUSTODY PETITION “FILED” BY DEFENDANT ATTORNEY; PLAINTIFF STATED CAUSES OF ACTION FOR LEGAL MALPRACTICE AND A VIOLATION OF JUDICIARY LAW 487 DESPITE THE ABSENCE OF PRIVITY (SECOND DEPT).

The Second Department, reversing Supreme Court, determined the legal malpractice action brought by a party who was not represented by the defendants should not have been dismissed. Plaintiff alleged the defendant attorney “filed” a fake custody petition for which plaintiff incurred $28,000 in attorney’s fees to defend against:

“While the complaint does not allege an attorney-client relationship between the plaintiff[ ] and the defendants, it sets forth a claim which falls within ‘the narrow exception of fraud, collusion, malicious acts or other special circumstances’ under which a cause of action alleging attorney malpractice may be asserted absent a showing of privity” … .

The Supreme Court further erred in granting that branch of the defendants’ motion which was pursuant to CPLR 3211(a)(7) to dismiss the cause of action alleging violation of Judiciary Law § 487. As relevant here, Judiciary Law § 487 imposes civil liability on any attorney who “[i]s guilty of any deceit or collusion, or consents to any deceit or collusion, with intent to deceive . . . any party.” Here, accepting the plaintiff’s allegations as true and giving the plaintiff the benefit of every possible favorable inference, the amended complaint adequately states a cause of action to recover damages for violation of Judiciary Law § 487 … . Garanin v Hiatt. 2023 NY Slip Op 04459, Second Dept 8-30-23

Practice Point: There are, as here, circumstances where a party who was not represented by the attorney can bring legal malpractice and “violation of Judiciary Law 487” actions against the attorney. Plaintiff alleged he was forced to defend against a fake custody petition “filed” by defendant attorney.

 

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​ IN THIS LEGAL MALPRACTICE ACTION, THE EVIDENCE SUBMITTED BY DEFENDANT ATTORNEYS IN SUPPORT OF THE MOTION TO DISMISS WAS NOT “DOCUMENTARY EVIDENCE;” THE PROOF REQUIREMENTS FOR A MOTION TO DISMISS ARE DIFFERENT FROM THE PROOF REQUIREMENTS FOR SUMMARY JUDGMENT; THE MOTION TO DISMSS SHOULD NOT HAVE BEEN GRANTED (SECOND DEPT).

The Second Department, reversing Supreme Court, determined the motion to dismiss in this legal malpractice case should not have been granted because the evidence offered in support of the motion (a letter from the insurer denying coverage and the insurance policy) was not “documentary evidence.” In addition, the Second Department noted that any deficiencies in the complaint were remedied by plaintiff’s affidavit submitted in opposition to the motion to dismiss. The complaint alleged defendant attorneys failed to timely file an action seeking recovery for personal injuries from a disability-insurance carrier:

“‘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'” … . * * *

“A motion to dismiss on the ground that the action is barred by documentary evidence pursuant to CPLR 3211(a)(1) may be granted only where the documentary evidence utterly refutes the plaintiff’s factual allegations, [thereby] conclusively establishing a defense as a matter of law” … . “[T]o be considered ‘documentary,’ evidence must be unambiguous and of undisputed authenticity” … . “[J]udicial records, as well as documents reflecting out-of-court transactions such as mortgages, deeds, contracts, and any other papers, the contents of which are essentially undeniable, would qualify as documentary evidence in the proper case” … . “Neither affidavits, deposition testimony, nor letters are considered documentary evidence within the intendment of CPLR 3211(a)(1)” … . Maursky v Latham, 2023 NY Slip Op 04115, Second Dept 8-2-23

Practice Point: Irrespective of the possible result of a summary judgment motion, a motion to dismiss which depends on evidence and is not supported by “documentary evidence” will lose.

 

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A LEGAL MALPRACTICE COMPLAINT WHICH ALLEGES CONCLUSORY AND SPECULATIVE DAMAGES WILL BE DISMISSED FOR FAILURE TO STATE A CAUSE OF ACTION (SECOND DEPT).

The Second Department, reversing Supreme Court, determined the legal malpractice complaint did not state a cause of action and should have been dismissed pursuant to CPLR 3211(a). Conclusory and speculative allegations of damages are not sufficient:

“‘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'” … . “To establish causation in a legal malpractice action, ‘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'” … . “‘Conclusory allegations of damages or injuries predicated on speculation cannot suffice for a malpractice action, and dismissal is warranted where the allegations in the complaint are merely conclusory and speculative'” … . Here, the plaintiff failed to state a cause of action to recover damages for legal malpractice because the plaintiff’s allegation that the restaurant would have had increased profits but for the defendants’ alleged malpractice is conclusory and speculative … . 126 Main St., LLC v Kriegsman, 2023 NY Slip Op 03758, Second Dept 7-12-23

Practice Point: A legal malpractice complaint does not state a cause of action if the damages allegations and conclusory are speculative.

 

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PLAINTIFF STATED A CLAIM FOR LEGAL MALPRACTICE BASED UPON THE ATTORNEYS’ ALLEGEDLY UNREASONABLE DELAYS IN PROSECUTING AN ACTION AGAINST A CONTRACTOR, RESULTING IN THE INABILITY TO COLLECT THE JUDGMENT (SECOND DEPT).

The Second Department, reversing Supreme Court, determined the complaint alleging legal malpractice should not have been dismissed. Plaintiff alleged the attorneys’ delays in prosecuting the action against a contractor resulted in plaintiff’s inability to collect a judgment against the contractor. By the time the judgment was acquired, the contractor had sold its assets and moved out of the country:

… [A]ccepting the facts alleged in the amended complaint as true, and according the plaintiff the benefit of every possible favorable inference, the amended complaint sufficiently states a cause of action to recover damages for legal malpractice. The amended complaint alleges that the defendants failed to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession by engaging in a pattern of undue delay in their prosecution of the underlying action, including by allowing the underlying action to be marked off the active calendar on two occasions and by failing to comply with certain court-ordered deadlines. The amended complaint further alleges that the defendants’ negligence proximately caused the plaintiff to sustain actual and ascertainable damages in that their delays in prosecuting the underlying action prevented him from being able to collect on the judgment that was eventually entered against the contractor … . Contrary to the defendants’ contention, the plaintiff’s allegations relating to proximate cause, including the nature and value of the contractor’s alleged assets and when they were disposed of, were not impermissibly speculative or conclusory … . Ofman v Tenenbaum Berger & Shivers, LLP, 2023 NY Slip Op 03471, Second Dept 6-28-23

Practice Point: Here the complaint stated a legal malpractice claim based upon the attorneys’ alleged unreasonable delays in prosecuting an action against a contractor, resulting in the inability to collect the judgment. The contractor sold its assets and moved out of the country.

 

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ALTHOUGH THE ATTORNEYS IN THIS LEGAL MALPRACTICE ACTION MISSED THE STATUTE OF LIMITATIONS, THE COMPLAINT DID NOT ALLEGE SUFFICIENT FACTS TO DEMONSTRATE THE UNDERLYING LAWSUITS WOULD HAVE SUCCEEDED HAD THEY BEEN TIMELY BROUGHT (SECOND DEPT).

​The Second Department, reversing Supreme Court, determined the legal malpractice action should have been dismissed because the complaint did not contain the “but for” allegations. It is not enough to allege defendants missed the statute of limitations, the complaint must also allege facts demonstrating the underlying lawsuits would have succeeded had they been timely brought:

… [T]he plaintiffs alleged that the decedent died after a brief admission to a drug and behavioral treatment facility, that the defendants agreed to represent the plaintiffs in an underlying action against the treatment facility and the medical providers who treated the decedent, that the defendants committed legal malpractice by failing to timely complete service of process in an action commenced in state court and by failing to commence a wrongful death cause of action in federal court before the applicable statute of limitations expired, and that the defendants’ failures resulted in the plaintiffs being unable to recover on their wrongful death causes of action. Absent from the complaint are any factual allegations relating to the basis for the plaintiffs’ purported wrongful death causes of action against the treatment facility or medical providers.

Accepting the facts alleged in the complaint as true, and according the plaintiffs the benefit of every possible favorable inference, the complaint failed to set forth facts sufficient to allege that [defendants’] purported negligence proximately caused the plaintiffs to sustain actual and ascertainable damages … . Even when considered with the documents submitted by the plaintiffs in opposition to the motion, the complaint failed to allege any facts tending to show that, but for [defendants’] alleged negligence in failing to timely serve process in the state court action and in failing to timely commence an action in federal court, the plaintiffs would have achieved a more favorable outcome on their wrongful death causes of action … . Buchanan v Law Offs. of Sheldon E. Green, P.C., 2023 NY Slip Op 01979, Second Dept 4-19-23

Practice Point: To sufficiently allege legal malpractice, the complaint must not only allege the attorneys’ negligence, here missing the statute of limitations, but sufficient facts must be alleged to demonstrate the lawsuit would have succeeded had it been timely brought.

See the companion decision: Buchanan v Law Offs. of Sheldon E. Green, P.C., 2023 NY Slip Op 01980, Second Dept 4-19-23

 

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ABSENT FRAUD OR COLLUSION, STRICT PRIVITY PRECLUDES THE PROSPECTIVE BENEFICIARIES OF AN ESTATE FROM BRINGING A LEGAL MALPRACTICE ACTION AGAINST THE ATTORNEY WHO PLANNED THE ESTATE; THE ATTORNEY OWED NO DUTY TO THE BENEFICIARIES (FIRST DEPT). ​

The First Department, reversing Supreme Court, determined the malpractice action by the prospective beneficiaries of an estate against the attorney who planned the estate should have been dismissed because there was no privity between the beneficiaries and the attorney:

In the context of estate planning malpractice actions, strict privity applies to preclude a third party, such as beneficiaries or prospective beneficiaries like plaintiffs, from asserting a claim against an attorney for professional negligence in the planning of an estate, absent fraud, collusion, malicious acts or other special circumstances … . While plaintiffs argue their claim against defendant attorneys is couched as one for simple negligence, as opposed to legal malpractice, plaintiffs have not pleaded facts to show that defendant attorneys owed plaintiffs a duty of care in the drafting of their client’s will and trust agreement. The strict privity requirement here protects estate planning attorneys against uncertainty and limitless liability in their practice … . Thus, plaintiffs’ negligence claim is unavailing for lack of factual allegations to demonstrate that defendants owed plaintiffs a duty.

Plaintiffs have not pleaded sufficient factual allegations in their amended complaint to indicate that circumstances of fraud, collusion and/or aiding and abetting exist in this case to override the strict privity rule. Plaintiffs have not alleged fraud with requisite specificity as, inter alia, there are no allegations defendants knowingly made material misrepresentations in the will and trust for the purpose of inducing justifiable reliance by their client (since deceased) upon such misrepresentations, and moreover the allegations made do not support favorable inferences in that regard … . Phillips v Murtha, 2023 NY Slip Op 01767, First Dept 4-4-23

Practice Point: Absent fraud or collusion, strict privity precludes a legal malpractice action by prospective beneficiaries of an estate against the attorney who planned the estate. Here the attorney owed no duty to the prospective beneficiaries.

 

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CONCLUSORY AND SPECULATIVE ALLEGATIONS PLAINTIFF WOULD NOT HAVE LOST ITS DISADVANTAGED BUSINESS ENTERPRISE (DBE) STATUS HAD DEFENDANT ATTORNEYS NOT FAILED TO FILE AN ADMINSTRATIVE APPEAL AND REQUEST A HEARING WERE NOT SUFFICIENT TO SURVIVE A MOTION TO DISMISS PURSUANT TO CPLR 3211 (A) (SECOND DEPT).

The Second Department, reversing (modifying) Supreme Court, determined the legal malpractice complaint should have been dismissed. Defendants allegedly did not pursue an administrative appeal and submitted a written response in lieu of a hearing. Plaintiff Mid City alleged the failures resulted in the termination of its status as a disadvantaged business enterprise (DBE). The Second Department held plaintiff did not demonstrate that but for the alleged legal malpractice the DBE status would not have been terminated:

… [E]ven accepting the facts alleged in the complaint as true, and according Mid City the benefit of every possible favorable inference … , the complaint failed to plead specific factual allegations demonstrating that, but for the defendants’ alleged negligence, there would have been a more favorable outcome regarding the termination of Mid City’s status as a DBE … . The allegation that Mid City lost the opportunity to pursue an administrative appeal, without any indication that the appeal would be successful, is insufficient to state a claim … . Similarly, the allegation that Mid City would have been recertified as a DBE had the defendants requested a hearing, rather than having filed a written response to the initial letter proposing termination of its status as a DBE, is speculative and conclusory … . Mid City Elec. Corp. v Peckar & Abramson, 2023 NY Slip Op 01085, Second Dept 3-1-23

Practice Point: To survive a motion to dismiss the complaint in a legal malpractice action, the plaintiff must make specific factual allegations demonstrating that but for the attorney’s negligence the outcome would have been more favorable. Conclusory or speculative “but for” allegations are not enough.

 

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PLAINTIFF IN THIS TRAFFIC ACCIDENT CASE ALLEGED DEFENDANT ATTORNEY NEGLIGENTLY FAILED TO PURSUE DAMAGES IN EXCESS OF THE POLICY LIMITS AGAINST THE TORTFEASOR PERSONALLY; DEFENDANT DID NOT DEMONSTRATE PLAINTIFF WOULD NOT HAVE PREVAILED AGAINST THE TORTFEASOR PERSONALLY; DEFENDANT’S MOTION FOR SUMMARY JUDGMENT SHOULD NOT HAVE BEEN GRANTED (SECOND DEPT).

The Second Department, reversing (modifying) Supreme Court, determined the legal malpractice action should not have been dismissed. It was alleged the defendant attorney, in this traffic accident case, failed to pursue damages in excess of the insurance-policy limits against the tortfeasor personally. Defendant did not demonstrate plaintiff would not have prevailed in an action against the tortfeasor personally:

“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 the plaintiff to sustain actual and ascertainable damages” … . “The plaintiff is required to plead actual, ascertainable damages that resulted from the attorneys’ negligence” … .

Here, the defendants failed to establish, prima facie, that the plaintiff had no actual or ascertainable damages. “The defendant must affirmatively demonstrate the absence of one of the elements of legal malpractice” … . The complaint alleged that the damages included the failure to pursue SUM benefits, as well as the failure to pursue recovery against the alleged tortfeasor. Since it was alleged … that the defendants’ legal malpractice prevented the plaintiff from obtaining a judgment against the alleged tortfeasor, the defendants had the burden of affirmatively demonstrating that the plaintiff would not have prevailed against the alleged tortfeasor or that the alleged tortfeasor did not have personal assets such that his motorist insurance policy limit that was recovered in the amount of $50,000, was the maximum judgment that could have been obtained from him … . The defendants failed to do so. Chicas v Cassar, 2023 NY Slip Op 00202, Second Dept 1-18-23

Practice Point: Defendant attorney in this legal malpractice case did not demonstrate plaintiff would not have prevailed in an action against the tortfeasor personally in the underlying traffic accident case. Plaintiff alleged defendant attorney negligently failed to seek damages over and above the policy limits from the tortfeasor. Therefore defendant’s motion for summary judgment should not have been granted.

 

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FAILURE TO ALLEGE THAT “BUT FOR” DEFENDANT ATTORNEY’S NEGLIGENCE PLAINTIFF WOULD HAVE PREVAILED REQUIRED DISMISSAL OF THE LEGAL MALPRACTICE COMPLAINT (FIRST DEPT).

The First Department determined plaintiff’s legal malpractice complaint was properly dismissed for failing to allege that “but for” the attorney’s negligence plaintiff would have prevailed:

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 … . 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 … . Markov v Barrows, 2022 NY Slip Op 04780, First Dept 8-2-22

Practice Point: To sufficiently allege legal malpractice, the complaint must allege that “but for” the attorney’s negligence plaintiff would have prevailed.

 

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