Appellate court reversed the court order dismissing the action on the law firm’s motion to dismiss.

In an action by a client against a law firm for legal malpractice, the appellate court reversed the court order dismissing the action on the law firm’s motion to dismiss. The court held:

“ 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 A.D.3d 169, 176, 924 N.Y.S.2d 484 [internal quotation marks omitted]; see Leder v. Spiegel, 9 N.Y.3d 836, 837, 840 N.Y.S.2d 888, 872 N.E.2d 1194). 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 A.D.3d at 1095–1096, 995 N.Y.S.2d 593; Endless Ocean, LLC v. Twomey, Latham, Shea, Kelley, Dubin & Quartararo, 113 A.D.3d 587, 589, 979 N.Y.S.2d 84; Reynolds v. Picciano, 29 A.D.2d 1012, 1012, 289 N.Y.S.2d 436). 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 A.D.3d at 526, 927 N.Y.S.2d 137). 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 A.D.2d 786, 787, 598 N.Y.S.2d 272).

Lopez v Lozner & Mastropietro, P.C., 166 AD3d 871 [2d Dept 2018]

 

R. A. Klass
Your Court Street Lawyer

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In Pari Delicto

In Pari Delicto — party’s wrongful doing — can bar a lawsuit.

“The doctrine of in pari delicto bars a party that has been injured as a result of its own intentional wrongdoing from recovering for those injuries from another party whose equal or lesser fault contributed to the loss (see Kirschner v KPMG, 15 N.Y.3d 446, 912 N.Y.S.2d 508, 938 N.E.2d 941 [2010]; [in pari delicto “mandates that the courts will not intercede to resolve a dispute between two wrongdoers”]; Chemical Bank v. Stahl, 237 A.D.2d 231, 232, 655 N.Y.S.2d 24 [1997] [in pari delicto “requires immoral or unconscionable conduct that makes the wrongdoing of the party against which it is asserted at least equal to that of the party asserting it”]).” Rosenbach v Diversified Group, Inc., 85 AD3d 569, 570 [1st Dept 2011].

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Tender of Payment

A seldom-used tactic in litigation is the “tender” of payment by a defendant of an amount which is believed to be due to the plaintiff. If the proper amount is tendered, and the plaintiff does not accept that amount, then the defendant will not be found liable for interest and court costs.

This legal tactic was successfully used by the author in a case involving the building of a large boys’ yeshiva. The yeshiva purchased a building to tear it down and construct a new school. The prior owner took back a mortgage from the yeshiva for $900,000, with interest-only payments for 15 years and no prepayments allowed. Shortly after the purchase, the yeshiva obtained work permits to demolish the existing structure to build the new school building.

The mortgagee/prior owner brought an injunction action, claiming that the demolition of the existing structure violated the terms of the mortgage (a common clause in the form of mortgage states that the mortgagee’s consent is needed before alteration of the structure on the mortgaged premises in order to protect the value of the collateral). During the course of ongoing court conferences, the yeshiva offered to pay off the mortgage in full, but the mortgagee was insistent on obtaining not only the principal amount of $900,000 but also the future 14 1/2 years’ worth of interest (a windfall of about $1.2 million).

The mortgagee then decided to unilaterally declare a default under the mortgage, alleging that the disconnection of the water and electric lines amounted to an alteration of the structure; her attorney served an “acceleration notice,” demanding the payment of the mortgage in full plus accrued interest.

From an initial review of the situation, it looked bleak for the yeshiva. But, upon further examination, the concept of “tender” saved the day! The yeshiva collected pledges totaling $911,000 (the principal amount plus accrued interest to the date of tender) and deposited that amount with the Clerk of Kings County as a “tender.” A motion was then made to dismiss both the injunction and foreclosure actions based upon the tender.

The court held that there was a valid tender, since the mortgagee accelerated the mortgage note, seeking the unpaid principal amount with “accrued” interest. Based upon the ambiguity of the language of the mortgage note, “accrued interest” may have meant interest accrued only to the date of default or future interest past the date of default.

Tender can be effectively utilized in situations where the defendant expects to owe something to the plaintiff but nowhere near the amount claimed. A tender can place a greater onus on the plaintiff to substantiate additional damages. Further, it can be a good method of settling a case by offering the plaintiff an amount which it may be willing to accept to terminate the litigation.

— by Richard A. Klass, Esq.

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copyr. 2015 Richard A. Klass, Esq.
The firm’s website: www.CourtStreetLaw.com
Richard A. Klass, Esq., maintains a law firm engaged in civil litigation in Brooklyn Heights, New York.
He may be reached at (718) COURT-ST or e-ml to RichKlass@courtstreetlaw.com with any questions.
Prior results do not guarantee a similar outcome.

Debt Collection Tips: Motions to Dismiss Affirmative Defenses or Counterclaims

After a suit is filed against a debtor to collect upon a debt, the defendant will file an Answer which may include “affirmative defenses” or “counterclaims.”  These allegations must be handled with vigilance from the onset to attempt successful recovery in the litigation.

An “affirmative defense” is a defense to a law suit which must be proved by the defendant.  Examples of affirmative defenses would include, e.g., bankruptcy, statute of limitations, improper service, and accord and satisfaction.  The notion is that those types of defenses would likely be determinative to the claim.  Therefore, the defendant must assert them in the Answer so as not to “surprise” the plaintiff-creditor at the time of trial.  Some affirmative defenses must be asserted either pre-Answer or in the Answer, or they are deemed waived by the defendant.  After receipt of the Answer, the plaintiff’s counsel should scan the Answer to identify any affirmative defenses and assess their viability.  To the extent that an affirmative defense seems frivolous, meritless, or superfluous, an appropriate motion to dismiss the affirmative defense should be made sooner rather than later.  The court will then determine whether to sustain the affirmative defense or dismiss it from the onset of the litigation.

As to any counterclaims which may be asserted in the Answer, a careful review must take place as to whether it relates to the matter complained of in the complaint, or relates to a separate matter.  Sometimes, the plaintiff will have an insurance policy which covers the counterclaim, and the insurance company will provide a defense to the counterclaim separate from the prosecution of the underlying suit.  If it is deemed that the counterclaim “fails to state a valid cause of action,” then an appropriate motion may be brought to dismiss the same.

— by Richard A. Klass, Esq.

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copyr. 2014 Richard A. Klass, Esq.
The firm’s website: www.CourtStreetLaw.com
Richard A. Klass, Esq., maintains a law firm engaged in civil litigation in Brooklyn Heights, New York.
He may be reached at (718) COURT-ST or e-ml to RichKlass@courtstreetlaw.com with any questions.
Prior results do not guarantee a similar outcome.

Cause of Action for Interference with Contract

A cause of action is properly alleged against defendants for their interference with contract when the following elements are set forth:

The Second Department held, in Miller v. Theodore-Tassy, 92 AD3d 650 [2012], that:

To prevail on a cause of action alleging tortious interference with contract, a plaintiff must establish “the existence of a valid contract between the plaintiff and a third party, defendant’s knowledge of that contract, defendant’s intentional procurement of the third-party’s breach of the contract without justification, actual breach of the contract, and damages resulting therefrom” citing Lama Holding Co. v. Smith Barney, 88 NY2d 413, 424.

— by Richard A. Klass, Esq.

———–
copyr. 2014 Richard A. Klass, Esq.
The firm’s website: www.CourtStreetLaw.com
Richard A. Klass, Esq., maintains a law firm engaged in civil litigation in Brooklyn Heights, New York.
He may be reached at (718) COURT-ST or e-ml to RichKlass@courtstreetlaw.com with any questions.
Prior results do not guarantee a similar outcome.

Statute Of Limitations For Actions Against Public Authority

A person has one year from the date a claim accrues to commence an action against a public authority such as LIRR (Public Authorities Law Section 1276(2). The complaint must contain an allegation that at least 30 days have elapsed since the authority was presented with a demand or claim and that the authority has neglected or refused to adjust or pay the claim. This “stay” of 30 days is not counted as part of the limitations period and the plaintiff therefore may serve a complaint at any time up to one year and 30 days after the claim has accrued.
— by Richard A. Klass, Esq.

———–
copyr. 2014 Richard A. Klass, Esq.
The firm’s website: www.CourtStreetLaw.com
Richard A. Klass, Esq., maintains a law firm engaged in civil litigation in Brooklyn Heights, New York.
He may be reached at (718) COURT-ST or e-ml to RichKlass@courtstreetlaw.com with any questions.
Prior results do not guarantee a similar outcome.

An attorney maintains a common law and statutory charging lien in the judgment

Under common law, an attorney was originally only entitled to a lien upon the judgment but the scope of the charging lien was extended by statute [Judiciary Law Section 475] to give the attorney a lien upon the client’s cause of action as well. The lien comes into existence, without notice or filing, upon commencement of the action or proceeding. See, Matter of Heinsheimer, 241 NY 361 [1915]. In Matter of Heinsheimer, Judge Cardozo stated,

If the attorney got possession of the fund, he had a general lien. If he did not get possession, his lien was for the services that brought the fund into existence. This charging lien still exists under our statutes. It has been enlarged to the extent that it now attaches to a cause of action even before judgment. ‘From the commencement of an action or special proceeding‘ the attorney now has a lien ‘upon his client’s cause of action, claim or counterclaim, which attaches to a verdict, report, decision, judgment or final order in his client’s favor, and the proceeds thereof in whosoever hands they may come.‘ (Judiciary Law, Cons. Laws, ch. 30, section 475.) Except as thus changed, the charging lien is today what it was at common law.

The concept of protecting an attorney’s lien in litigation from inception through and after entry of judgment is an old one. As stated in the decision of Fischer-Hansen v. The Brooklyn Heights Railroad Company, 173 NY 492 [1903].

There is much learning in the books relating to the lien of an attorney upon a judgment for his costs as it existed before the statute, and though now virtually obsolete, it shows the fixed determination of the courts to protect attorneys against fraudulent settlements. The lien upon a judgment was not created by statute, but was ‘a device invented by the courts for the protection of attorneys against the knavery of their clients by disabling their clients from receiving the fruits of recoveries without paying for the valuable services by which the recoveries were obtained.’ Goodrich v. McDonald, 112 NY 157 [1889].

In Peri v. The New York Central and Hudson River Railroad Company, 152 NY 521 [1897], the Court of Appeals held that an attorney’s charging lien is a statutory lien “of which all the world must take notice, and any one settling with a plaintiff without the knowledge of his attorney, does so at his own risk.” In this case, that risk is borne by all of the defendants.

New York Judiciary Law Section 475 provides:

From the commencement of an action, special or other proceeding in any court or before any state, municipal or federal department, except a department of labor, or the service of an answer containing a counterclaim, or the initiation of any means of alternative dispute resolution including, but not limited to, mediation or arbitration, or the provision of services in a settlement negotiation at any stage of the dispute, the attorney who appears for a party has a lien upon his client’s cause of action, claim or counterclaim, which attaches to a verdict, report, determination, decision, award, settlement, judgment or final order in his client’s favor, and the proceeds thereof in whatever hands they may come; and the lien cannot be affected by any settlement between the parties before or after judgment, final order or determination. The court upon the petition of the client or attorney may determine and enforce the lien.

The Court of Appeals noted, in Matter of City of New York (United States of America-Coblentz), 5 NY2d 300 [1959], that the statute gives an attorney a lien on the cause of action which attaches to the judgment from the commencement of the action. In the decision, the Court stated that Section 475, in substance, declares the common law. The origin of an attorney’s lien, whether as retaining or as charging, is obscure, but in all events, irrespective of type, has been recognized and enforced by the courts from very early times (see Fourth Annual Report of N. Y. Judicial Council, 1938, p. 49; 7 C. J. S., Attorney and Client, Section 210 et seq.; 5 Am. Jur., Attorneys at Law, Section 208 et seq.). The underlying purpose at both common law and now, by statute, is to protect an attorney against the ‘knavery of his client’ (Matter of Rosentover v. Weiss, 247 AD 137 affirmed 272 N.Y 557; Goodrich v. McDonald, 112 NY 157) and, being created by statute, does not require the giving of any notice in order to bring it into existence (Matter of Drake v. Pierce Butler Radiator Corp., 202 Misc. 935) for it is generally regarded as an equitable assignment to the attorney of the fund procured by his efforts to the extent of the amount of his lien (Matter of Herlihy, 274 AD 342).

Other parties do not have the ability to destroy the attorney’s vested property rights in and to the Judgment. See, LMWT Realty Corp. v. Davis Agency, Inc., 85 NY2d 462 [1995] (“Manifestly, then, an attorney’s charging lien is something more than a mere claim against either property or proceeds; an attorney’s charging lien “is a vested property right created by law and not a priority of payment”).

In enforcing the charging lien, the attorney is not required to solely chase after his client for the money he is owed; he can also pursue the other defendants. In Haser v. Haser, 271 AD2d 253 [1 Dept. 2000], the court held that, under New York law, a plaintiff’s attorney may enforce her statutory charging lien against the defendant’s own assets, if he still possesses the settlement proceeds or knowingly paid them to the plaintiff so as to deprive the attorney of her compensation (citing to Kaplan v Reuss, 113 AD2d 184, 186-187, affd 68 NY2d 693; Fischer-Hansen v Brooklyn Hgts. R. R. Co., 173 NY 492, 502). The lien which attaches in the attorney’s favor cannot be impaired by a collusive settlement.

— by Richard A. Klass, Esq.

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copyr. 2014 Richard A. Klass, Esq.
The firm’s website: www.CourtStreetLaw.com
Richard A. Klass, Esq., maintains a law firm engaged in civil litigation in Brooklyn Heights, New York.
He may be reached at (718) COURT-ST or e-ml to RichKlass@courtstreetlaw.com with any questions.
Prior results do not guarantee a similar outcome.

Klass in the News: Yoko Ono’s publicist sues Eataly for $20M after bouncer ‘beatdown’

By Julia Marsh and Natasha Velez
PageSix

August 29, 2014 | 11:52am

Maybe the security guards at Mario Batali‘s Eataly need to give peace a chance.

Yoko Ono‘s publicist is suing the Manhattan pasta emporium for at least $20 million after he was allegedly beaten up by bouncers, thrown through a glass window and then called a “p—–” and a “f—–.”

Kip Kouri, head of Tell All Your Friends PR, was trying to get a table at Eataly’s popular rooftop beer garden Birreria on July 17 when he was “violently assaulted by” 10 unnamed security guards, according to his Manhattan civil suit.

His attorney, Richard Klass, told The Post his client was at the Fifth Avenue eatery with his boyfriend, sister and stepmother and got into an argument with the hostess about his reservation….(more)

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copyr. 2014 Richard A. Klass, Esq.
The firm’s website: www.CourtStreetLaw.com
Richard A. Klass, Esq., maintains a law firm engaged in civil litigation in Brooklyn Heights, New York.
He may be reached at (718) COURT-ST or e-ml to RichKlass@courtstreetlaw.com with any questions.
Prior results do not guarantee a similar outcome.

Klass in the News: Eataly sued by Yoko Ono’s public relations agent, who restaurant rep says was ‘visibly intoxicated’

Kip Kouri claims he was ‘thrown’ through a plate glass window by bouncers who also made homophobic remarks. In a statement, restaurant spokeswoman Cristina Villa said Kouri was ‘acting as a potential threat to others.’

By Barbara Ross and Corky Siemaszko
New York Daily News
Published: August 29, 2014, 11:29am
Updated: August 30, 2014, 12:14am

What a pane!

Yoko Ono’s flack claims he was “thrown” through a plate glass window by three bigoted bouncers at celebrity chef Mario Batali’s eatery Eataly, and is now suing the operation for $10 million.

Kip Kouri claims in court papers the strongmen called him a “p—y” and a “f—-t” and that he suffered a severe gash on one leg that required 60 stitches to close.

“It took a significant amount of force to do what they did,” Kouri’s lawyer, Richard Klass, said Friday. “This was a thick window.”…(more)

———–
copyr. 2014 Richard A. Klass, Esq.
The firm’s website: www.CourtStreetLaw.com
Richard A. Klass, Esq., maintains a law firm engaged in civil litigation in Brooklyn Heights, New York.
He may be reached at (718) COURT-ST or e-ml to RichKlass@courtstreetlaw.com with any questions.
Prior results do not guarantee a similar outcome.

Pay the Worker on the Day He (or She) Works

We can do it!, ca. 1942 - ca. 1943; Creator(s): Office for Emergency Management. War Production Board.

This guiding principle is so important that it is laid out in several passages throughout the Bible. It is incumbent upon an employer to pay the wages of its employees on a timely basis. If the employer does not pay its employees, New York State law provides employees with significant remedies, including an entitlement to monetary penalties against the employer over and above the unpaid wages and the recovery of attorney’s fees.

Some teachers in a private religious school were not paid their salaries for several months. The school’s administration claimed that, due to the nonpayment of tuition by a large number of the parent body, the school could not pay these teachers. In the meantime, however, the school continued to pay some of its teachers, business-as-usual. One of the teachers who was not paid her salary hired Richard A. Klass, Your Court Street Lawyer, to help recover her unpaid wages.

100% liquidated damages under NY’s labor law

An action was brought on behalf of the teacher against the private religious school for the unpaid wages. The complaint also sought the additional amount of liquidated damages that may be awarded to an employee for wages owed by an employer on an unpaid wage claim. The entitlement to this additional element of damages (“equal to 100% of the total amount of the wages found to be due”) and reasonable attorney’s fees are provided for in New York State Labor Law Section 198(1-a). Specifically, Labor Law Section 198(1-a) provides, in relevant part:

In any action instituted in the courts upon a wage claim by an employee or the commissioner in which the employee prevails, the court shall allow such employee to recover the full amount of any underpayment, all reasonable attorney’s fees, prejudgment interest as required under the civil practice law and rules, and, unless the employer proves a good faith basis to believe that its underpayment of wages was in compliance with the law, an additional amount as liquidated damages equal to one hundred percent of the total amount of the wages found to be due.

Under the above statute, an employer must be able to prove that it had a “good faith basis” to believe that its failure to pay its employees was in compliance with the law in order to avoid an award of liquidated damages. In this case, it was urged that the school had no valid basis for not paying its teachers.

Religious school can be sued in secular court

The religious school argued that the Establishment Clause of the United States Constitution (separation of church and state) barred the government’s excessive entanglement in religion—in essence, stating that this dispute belonged in a rabbinical court. In response to this argument, it was urged that this case was not about religion; it was squarely and fundamentally about the breach of an employment contract.

Courts can apply ‘neutral principles of law’ to dispute

Respecting the place of religion in American society, courts will generally decline to involve themselves in disputes involving religious institutions except under limited circumstances. New York State’s highest court, the Court of Appeals, in Congregation Yetev Lev D’Satmar, Inc. v. Kahan, held that where the matter to be decided does not involve questions of discipline and doctrine but is a temporal matter, a court may inquire and consider the same in the light of the civil contractual rights and obligations of the parties. The Court of Appeals stated, “Civil disputes involving religious parties or institutions may be adjudicated without offending the First Amendment as long as neutral principles of law are the basis for their resolution (see First Presbyterian Church of Schenectady v. United Presbyterian Church in the United States of America). The “neutral principles of law” approach requires the court to apply objective, well-established principles of secular law to the issues.”
In Saffra v. Rockwood Park Jewish Center, Inc., the court held that issues surrounding a rabbi’s employment agreement with a synagogue were not an ecclesiastical matter but rather a matter dealing with a “mundane” contract to be construed by a court. New York law recognizes that “a religious corporation is liable on its contracts the same as any other corporation and, generally, questions concerning the contractual liability of a religious corporation are controlled by the principles governing the contractual powers and liability of corporations generally.” See, 92 N.Y. Jur.2d Religious Organizations, Section 16. Accordingly, the fact that the school was a religious school would be irrelevant to its liability for breaching its contractual obligations to its teachers for unpaid wages.
There were no religious issues or doctrines presented in this case; the action was brought solely to enforce the teacher’s contract rights to recover her unpaid wages for the period of time that she had already performed under her teaching contract. Faced with the arguments put forth by the teacher, the school relented and paid over $23,000 of back wages owed to the teacher, along with all of her legal fees and expenses.
— by Richard A. Klass, Esq.

———–
copyr. 2014 Richard A. Klass, Esq.
The firm’s website: www.CourtStreetLaw.com
Richard A. Klass, Esq., maintains a law firm engaged in civil litigation in Brooklyn Heights, New York.
He may be reached at (718) COURT-ST or e-ml to RichKlass@courtstreetlaw.com with any questions.
Prior results do not guarantee a similar outcome.

Credits: Photo of Richard Klass by Robert Matson, copyr. Richard A. Klass, 2011.
Marketing services by The Innovation Works, Inc. www.TheInnovationWorks.com.

Image on page one: We can do it!, ca. 1942 – ca. 1943; Creator(s): Office for Emergency Management. War Production Board.