Judiciary Law Section 487:
This statute punishes attorneys who commit fraud upon the court, other parties or their clients.
There is a special statute designed to punish attorneys who commit fraud upon the court, other parties or their clients, Judiciary Law Section 487.
Section 487 states as follows:
Misconduct by attorneys. An attorney or counselor who:
1. Is guilty of any deceit or collusion, or consents to any deceit or collusion, with intent to deceive the court or any party; or,
2. Wilfully delays his client’s suit with a view to his own gain; or, wilfully receives any money or allowance for or on account of any money which he has not laid out, or becomes answerable for,
Is guilty of a misdemeanor, and in addition to the punishment prescribed therefor by the penal law, he forfeits to the party injured treble damages, to be recovered in a civil action.
Generally, New York courts have held that a cognizable claim under Judiciary Law Section 487 exists when there is a ‘chronic and extreme pattern of legal delinquency.’ Solow Management Corp. v. Seltzer, 18 AD3d 399 (1st Dept. 2005), citing toJaroslawicz v. Cohen, 12 AD3d 160 (1st Dept. 2004); Cohen v. Law Offices of Leonard and Robert Shapiro, 18 AD3d 219 (1st Dept. 2005). Some courts have held “a single act or decision, if sufficiently egregious and accompanied by an intent to deceive, is sufficient to support liability [under Judiciary Law Section 487]. Trepel v. Dippold, 2005 WL 1107010 (SDNY 2005). In the cited Jaroslawicz action, the First Department held:
The cause of action for statutory treble damages under Judiciary Law §487 was properly dismissed because there is no pleading that defendants acted with ‘intent to deceive the court or any party,’ and no pleading of a pattern of delinquent, wrongful, or deceitful behavior by the attorney defendants, or of pecuniary damages resulting from the alleged wrong.
Coupled with the above pleading requirements, the plaintiff must plead that “the alleged deceit forming the basis of such a cause of action, if it is not directed at a court, must occur during the course of a ‘pending judicial proceeding.’” Costalas v. Amalfitano, 305 AD2d 202 (1st Dept. 2003), citing to Hansen v. Caffry, 280 AD2d 704, lv. denied, 97 NY2d 603.
In order to recover under Judiciary Law Section 487, a plaintiff must plead and prove both actual deceit by the attorney, Bernstein v. Oppenheim, 160 A.D.2d 428, (1st Dep’t 1990), and causation, that is, that the deceit or collusion actually caused plaintiff’s damages. See, e.g., Manna v. Ades, 237 A.D.2d 264 (2d Dept. 1997); DiPrima v. DiPrima, 111 A.D.2d 901 (2d Dept. 1985); Brown v. Samalin & Bock, P.C., 155 A.D.2d 407 (2d Dept. 1989).
Concerning the issue as to what constitutes “deceit” under Judiciary Law Section 487, the court in Amalfitano v. Rosenberg, 428 F.Supp.2d 196 (SDNY 2006), set forth the definition from Black’s Law Dictionary (8th Ed. 2004), as including: (1) The act of intentionally giving a false impression… (2) A false statement of fact made by a person knowingly or recklessly (i.e. not caring whether it is true or false) with the intent that someone else will act upon it… (3) A tort arising from a false representation made knowingly or recklessly with the intent that another person should detrimentally rely on it.
As to the issue of what constitutes damages under Judiciary Law Section 487, the court in Amalfitano v. Rosenberg, supra, determined that the parties’ costs in defending themselves in the litigation against an action which was founded upon deceit were damages under such section.
In a recent decision of the NYS Court of Appeals, Melcher v. Greenberg Traurig, LLP, 2014 NY Slip Op. 02213 , the court had to determine whether the statute of limitations in actions brought under Judiciary Law Section 487 were governed by the 3-year statute of limitations period under CPLR 214(2) or the “catch-all” provision under CPLR 213(1), which provides a 6-year statute of limitations period in which to bring an action against an attorney for deceit or collusion. The Court held that claims brought against attorneys for deceit or collusion under Judiciary Law Section 487 are subject to the 6-year statute of limitations set forth in CPLR 213(1).
By Richard Klass, Esq.
“Your Court Street Lawyer”