Steinowitz v Gambescia

[*1] Steinowitz v Gambescia 2009 NY Slip Op 51370(U) [24 Misc 3d 132(A)] Decided on June 29, 2009 Appellate Term, Second Department Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on June 29, 2009
SUPREME COURT OF THE STATE OF NEW YORK
APPELLATE TERM: 9th and 10th JUDICIAL DISTRICTS
PRESENT: : RUDOLPH, P.J., TANENBAUM and SCHEINKMAN, JJ
2008-856 W C.

Bruce L. Steinowitz, Appellant,

against

Carla Gambescia d/b/a ARTFUL ENTERPRISES/PHOENIX CREATIVE MARKETING, Respondent.

Appeal from an order of the City Court of White Plains, Westchester County (JoAnn Friia, J.), entered February 8, 2008. The order denied plaintiff's motion to dismiss defendant's counterclaims.

Order modified by providing that plaintiff's motion to dismiss defendant's counterclaims is granted to the extent of dismissing defendant's second and third counterclaims; as so modified, affirmed without costs.

Plaintiff, an attorney, commenced the instant action to recover damages for breach of contract and upon an account stated for legal services rendered to defendant, a former client, in connection with an underlying Supreme Court action ("the Sunrise litigation"). Defendant answered and, in addition to interposing various affirmative defenses, asserted a first counterclaim for legal malpractice, a second counterclaim for breach of plaintiff's fiduciary responsibility, and a third counterclaim for plaintiff's violation of Judiciary Law § 487. Thereafter, plaintiff moved, pursuant to CPLR 3211 (a) (7), to dismiss the counterclaims. The motion was denied by the City Court, and this appeal by plaintiff ensued.

In determining a motion to dismiss pursuant to CPLR 3211 (a) (7), a court must determine whether there is a cognizable cause of action and not whether the cause of action has been properly pleaded (see Leon v Martinez, 84 NY2d 83 [1994]). The pleading must be liberally construed and the pleader given the benefit of every favorable inference (id.). Moreover, the issue, in deciding a motion to dismiss, is whether the pleader has a cause of action and not whether the pleader will ultimately succeed on the merits (see Jacobs v Macy's East, Inc., 262 AD2d 607 [1999]).

The City Court properly denied the branch of plaintiff's motion seeking to dismiss [*2]defendant's first counterclaim, alleging legal malpractice. The first counterclaim essentially alleged that plaintiff's representation in the underlying Sunrise litigation fell below "the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession" and that the attorney's breach of this professional duty proximately caused the client to sustain "actual and ascertainable damages" (Rudolf v Shayne, Dachs, Stanisci, Corker & Sauer, 8 NY3d 438, 442 [2007]), in that plaintiff, inter alia, had failed to assert a cause of action for an account stated and had not, in the ensuing arbitration proceeding, presented a case in quantum meruit, which failures resulted in a decision adverse to defendant.

An attorney's error in judgment or selection of one among several reasonable courses of action does not necessarily constitute legal malpractice (see Rosner v Paley, 65 NY2d 736 [1985]). Thus, a purported legal malpractice claim which amounts only to a client's criticism of counsel's strategy may be dismissed as insufficient (see Palazzolo v Herrick, Feinstein, LLP, 298 AD2d 372 [2002]). However, the question of whether plaintiff's representation of defendant in the Sunrise litigation amounted to legal malpractice or constituted a reasonable course of conduct raises issues of fact which are not resolvable at this stage of the litigation (see e.g. Bernstein v Oppenheim & Co., 160 AD2d 428 [1990]). Thus, taking defendant's allegations as true, and according defendant the benefit of every possible favorable inference (see Leon, 84 NY2d at 87-88), the allegations set forth in the first counterclaim state a legally cognizable cause of
action for legal malpractice and are sufficient to survive plaintiff's motion to dismiss pursuant to CPLR 3211 (a) (7).

To be contrasted are defendant's second and third counterclaims. The crux of defendant's second counterclaim against plaintiff is that plaintiff breached his fiduciary responsibility to defendant in the Sunrise litigation by revealing the names of her customers without her authorization, in violation of former Code of Professional Responsibility DR 4-101 (22 NYCRR 1200.19 [b] [1], [2]), then in effect, and that said customers withdrew their business from her as a result. An attorney's alleged violation of a disciplinary rule does not, by itself, give rise to a private cause of action for breach of a fiduciary duty (see Schwartz v Olshan Grundman Frome & Rosenzweig, 302 AD2d 193, 199 [2003]; see also Kantor v Bernstein, 225 AD2d 500 [1996]; Weintraub v Philips, Nizer, Benjamin, Krim, & Ballon, 172 AD2d 254 [1991]). Although in some cases "conduct constituting a violation of a disciplinary rule may . . . constitute evidence of malpractice" (see Swift v Ki Young Choe, 242 AD2d 188, 194 [1998]), in the instant case, the factual assertions made by defendant in the second counterclaim are conclusory and speculative, and are insufficient to support her allegations of breach of a fiduciary responsibility. Notwithstanding the aforementioned rule that, on a motion to dismiss pursuant to CPLR 3211 (a) (7), the pleading must be liberally construed and the pleader accorded the benefit of every possible favorable inference (see Leon v Martinez, 84 NY2d at 87-88), a court is not required to accept as truthful, allegations consisting of bare conclusory assertions, and such allegations are not accorded every favorable inference (see Doria v Masucci, 230 AD2d 764 [1996]). Consequently, the City Court should have granted the branch of plaintiff's motion seeking to dismiss defendant's second counterclaim.

In the third counterclaim, defendant seeks treble damages as a result of plaintiff's alleged violation of Judiciary Law § 487, in that plaintiff knowingly made a false statement in a sworn filing in connection with the arbitration proceeding. In order to maintain such cause of action, a [*3]party must show that the attorney intended to deceive the party or the court, or that the attorney "engaged in a chronic, extreme pattern of legal delinquency" (see Schindler v Issler & Schrage, 262 AD2d 226, 228 [1999]; see also Izko Sportswear Co., Inc. v Flaum, 25 AD3d 534 [2006]), and that the client sustained damages as a result of such conduct (see Werner v Katal Country Club, 234 AD2d 659, 663 [1996]). Even if we accept as true the factual allegations of the third counterclaim, they fail to allege the requisite deceit or pattern of delinquency sufficient to demonstrate that defendant has a cognizable claim under the statute. There is also an insufficient showing of how plaintiff's conduct caused damage to
defendant. Accordingly, the City Court should have granted the branch of plaintiff's motion seeking to dismiss defendant's third counterclaim.

Rudolph, P.J., and Tanenbaum, J., concur.

Scheinkman, J., taking no part.
Decision Date: June 29, 2009