Tolmosova v Umarova

[*1] Tolmosova v Umarova 2012 NY Slip Op 51921(U) Decided on October 1, 2012 Supreme Court, Kings County Schmidt, J. 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 This opinion is uncorrected and will not be published in the printed Official Reports.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 October 1, 2012
Supreme Court, Kings County

Larisa Tolmosova, Plaintiff,

against

Ludimila Umarova, Skazka iii, Inc., Elvira Benyminova, Kids Kingdom, Inc., Emilya Losyev, Lilly Godzhinsky, Roman Popik and Timur Umarov, Defendants.



14697/03



Plaintiff Attorney: Alexander Shiryak, 125-10 Queens Blvd., Ste. 222, Kew Gardens, NY 11415

Defendant Attorney: Roman Popik, P.C., 1500 Broadway, Ste. 2013, New York, NY 10036

David Schmidt, J.

The following papers numbered 1 to 6 read on this motion:

Papers Numbered

Notice of Motion/Order to Show Cause/

Petition/Cross Motion and

Affidavits (Affirmations) Annexed1-2

Opposing Affidavits (Affirmations)3-5

Reply Affidavits (Affirmations)6Affidavit (Affirmation)Other Papers

Upon the foregoing papers, defendant Roman Popik, Esq., appearing on his own behalf, moves, pursuant to CPLR 3211(a)(7), to dismiss the complaint insofar as asserted against him or, in the alternative, for summary judgment dismissing the complaint pursuant to CPLR 3212.

This instant action against defendant sounds in legal malpractice and breach of [*2]fiduciary duty. The verified complaint alleges that in October, 1999, defendant Ludimila Umarova (Umarova) induced plaintiff Larisa Tolmasova (plaintiff) and defendant Elvira Benyaminova (Benyaminova) to purchase property located at 4321 Avenue D in Brooklyn (the Avenue D premises) for the purpose of opening a daycare center children. In April, 2000, plaintiff and Benyaminova purchased the Avenue D premises in order to open the daycare center, agreeing to "take a [f]ifty percent . . . share of the property and attendant business."

During the formation and construction of the business, Umarova demanded $140,000.00 to provide plaintiff and Benyaminova with a certificate of occupancy for the premises. Umarova represented to plaintiff and Benyaminova that in order to open and operate the daycare business in the Avenue D premises, the money had to be paid to her (Umarova) exclusively.

In November, 1999, Umarova and Benyaminova informed plaintiff that some of the money for the certificate of occupancy had been paid by Benyaminova to Umarova, and then demanded the balance of the payment for the certificate from plaintiff.

On or about November 17, 1999, plaintiff tendered $72,000.00 to Umarova. Shortly thereafter, plaintiff began to question Umarova's demand for payment for the certificate of occupancy for a property Umarova allegedly did not own.

According to the complaint, Umarova never produced the certificate; the nature and work provided by Umarova in obtaining the certificate was never substantiated; and the property already had a certificate of occupancy for the same use (a daycare center) that was planned by plaintiff and Benyaminova.

On or about April 12, 2000, Benyaminova executed a promissory note acknowledging her indebtedness to plaintiff for the sum of $60,700.00, which became due on April 12, 2001.

Sometime thereafter, Umarova proposed that plaintiff take a 50% ownership interest in the premises and daycare center located at 2918 Avenue I, Brooklyn (the Avenue I premises). Umarova hired defendant attorney Popik (Mr. Popik or defendant) to draft an agreement (in fact a "Letter of Intent")[FN1] for the proposed transaction, which represented the interests of four parties, namely plaintiff, defendant Losyev, Umarova, and Benyaminova.

Mr. Popik drafted the Letter of Intent which was signed on August, 24, 2000. The Letter of Intent referenced various transfers among the signatories with respect to ownership of the Avenue D premises and Avenue I premises. Moreover, in it, Benyaminova acknowledged her indebtedness to plaintiff for $60,700.00 as evidenced by the promissory note executed on April 12, 2000. The complaint sets forth the salient provisions of the Letter of Intent as follows:

"a. Plaintiff is to transfer her Fifty Percent (50%) ownership in the Avenue D [*3]Premises to Defendant Losyev[;]

b. Plaintiff is to transfer her Fifty Percent (50%) ownership in the business located on the Avenue D Premises to Defendant Losyev[;]

c. Defendant Umarova would purchase Fifty Percent (50%) ownership of the Avenue I Premise for Plaintiff[;]

d. Defendant Umarova would purchase Fifty Percent (50%) ownership in the business located on the Avenue I Premises for Plaintiff[;]

e. In the event Defendant Umarova failed to purchase Fifty Percent (50%) interest in the Avenue I Premise and the business located on said premises, Plaintiff would be entitled to One Hundred Percent (100%) of the stock of Defendant Skazka III, Inc.[;]

f. Defendant Benyaminova acknowledges the promissory note executed

on April 12, 2000 of her indebtedness to Plaintiff in the amount of Sixty

Thousand Seven Hundred ($60,700), Dollars."

On or about September 13, 2000, Benyaminova signed a second promissory note reaffirming her indebtedness to plaintiff in the amount of $60,700.00.

The complaint alleges five causes of action - the first four with respect to the signatories to the agreement. The first cause of action is alleged against Benyaminova for repayment of the promissory note; the second cause of action is alleged against Benyaminova for her share of the Avenue D property and business and/or her share of defendant Kids Kingdom (another daycare business); the third cause of action is alleged against Umarova for fraud and conversation for representing to plaintiff that she (Umarova) was the only person capable of obtaining the certificate of occupancy; and the fourth cause of action is alleged against Umarova for a judgment transferring 100% of the shares of Skazka III, Inc. to plaintiff.

The fifth cause of action alleges legal malpractice and breach of fiduciary duty against Mr. Popik in the drafting of the August 24, 2000 agreement. Specifically, the complaint alleges that Mr. Popik failed to exercise reasonable skill and knowledge commonly possessed by a member of the legal profession in representing multiple parties with potential conflicts of interest; failed to inform plaintiff of her right to have independent counsel review and evaluate the agreement, and discouraged her from doing so; and failed to provide plaintiff with a general waiver or release regarding representation of multiple parties in connection with the agreement. The complaint further alleges that Mr. Popik's negligence and breach of fiduciary duty caused plaintiff to sustain damages, including the [*4]loss of ownership and interest in the Avenue D and Avenue I premises.

In August, 2003, defendant filed a verified answer. Shortly thereafter, plaintiff discontinued this action against Benyaminova and did not pursue default judgments against co-defendants Skazka III, Inc., Kids Kingdom, Losyev, and Lilly Godzhinsky.

By order dated October 19, 2004, Hon. Francois A. Rivera granted the motion of Umarova to dismiss the third cause of action to the extent it sought damages for conversion as time-barred, and dismissed the third cause of action to the extent it sought damages for fraud for failure to state a cause of action. Subsequently, plaintiff abandoned the complaint against now deceased defendant Timur Umarov. It is undisputed that since the commencement of this action, plaintiff has not served any discovery demands upon any other defendant nor did she seek the deposition of Mr. Popik.

After extensive motion practice, plaintiff was deposed on August 12, 2011. On September 13, 2011, Mr. Popik sent by certified mail to plaintiff's counsel a letter together with an original transcript of plaintiff's deposition, which was never returned.

In December, 2011, Mr. Popik moved to dismiss the complaint insofar as asserted against him.

Discussion

"In order to prevail in an action to recover damages for legal malpractice, a plaintiff must establish that the defendant attorney failed to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession, and that the breach of this duty proximately caused the plaintiff to sustain actual and ascertainable damages" (Ali v Fink, 67 AD3d 935, 936 [2009]). Moreover, "[t]o establish the element of causation, 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 attorney's negligence" (id.). "[T]he failure to demonstrate proximate cause requires dismissal of a legal malpractice action regardless of whether the attorney was negligent" (Markowitz v Kurzman Eisenberg Corbin Lever & Goodman, LLP, 82 AD3d 719, 719 [2011] [internal quotation marks and citations omitted]). "An attorney moving for summary judgment dismissing a legal malpractice claim has the burden of establishing, through the submission of proof in evidentiary form, that the plaintiff is unable to prove at least one of the essential elements of the cause of action" (Ali, 67 AD3d at 936).

Further, "it is well settled that in considering a motion to dismiss brought pursuant to CPLR 3211 (a) (7), the court must presume the facts pleaded to be true and must accord them every favorable inference" (Leder v Spiegel, 31 AD3d 266, 267[2006], affd 9 NY3d 836 [2007])." "It is, however, also axiomatic that factual allegations which fail to state a viable cause of action, that consist of bare legal conclusions, or that are inherently incredible or unequivocally contradicted by documentary evidence, are not entitled to such consideration" (id.). [*5]

Here, Mr. Popik has demonstrated that the complaint fails to state a cause of action for legal malpractice and has made a prima facie showing entitling him to summary judgment dismissing the complaint insofar as asserted against him. In this regard, the complaint, along with the testimony of plaintiff, fails to demonstrate that the advice provided by defendant to plaintiff was the proximate cause of plaintiff's alleged damages and that plaintiff sustained actual and ascertainable damages.

Specifically, the first cause of action alleges that Benyaminova failed to pay plaintiff the amount set forth in the April 12, 2000 promissory note: $60,700.00, plus interest, costs and attorney's fees. However, it is undisputed that the promissory note was prepared by another attorney, which was executed by Benyaminova three months before plaintiff represented defendant. Thus, Mr. Popik properly argues that there is no nexus between his representation of plaintiff and Benyaminova's failure to pay plaintiff. In any event, plaintiff testified at her deposition that she received full payment ($47,000.00) in full satisfaction of this debt alleged in the first cause of action.

Plaintiff's second cause of action alleges that if Benyminova failed to pay plaintiff back as agreed (in the Letter of Intent), Benyaminova's share in the Avenue D business would be transferred to Skazka III, Inc.; that Benyaminova's interest in Avenue D was in the form of a 50% ownership in Kids Kingdom; that plaintiff would be entitled to all the ownership interest in Skazka III, Inc. if plaintiff was not made the owner of the Avenue I premises and business; and that since plaintiff was not made the owner of the Avenue I premises and business, as set forth in the Letter of Intent, and since plaintiff was not made the owner of the Avenue I premises and business, and Benyaminova failed to pay plaintiff back, plaintiff is entitled to Benyaminova's share of the property and business at the Avenue D premises and/or Benyaminova's share of defendant Kids Kingdom Inc. Despite these allegations, plaintiff testified that she was not making a claim against Benyaminova "at this time." Plaintiff also testified that she was no longer interested in getting the shares of Skazka III, Inc. ("I don't want any Skazka or anything"). Similar to the first cause of action, the allegations of this cause of action fail to allege any breach by defendant or that any alleged breach proximately caused plaintiff to sustain any damages.

The third cause of action alleges that Umarova and Benyaminova fraudulently represented to plaintiff that Umarova was the only individual capable of obtaining the certificate of occupancy for a cost of $140,000.00 for the Avenue D premises; that the Avenue D premises already had a daycare certificate; and that therefore Umarova was liable to plaintiff for punitive damages. However, this cause of action has already been dismissed. In any event, plaintiff testified that defendant was not involved in making these purported fraudulent representations, thus this cause of action cannot serve as a basis for a legal malpractice claim against defendant.

The fourth cause of action has been dismissed as well. It alleges that if Umarova failed to purchase 50% of the Avenue I premises and business, the plaintiff would be entitled to 100% of the shares of Skazka III, Inc., and that Umarova failed to make that [*6]purchase. However, plaintiff testified that defendant was not required to purchase a part of the Avenue I premises. Thus, there is no basis for a claim for legal malpractice with respect to this cause of action - Mr. Popik was not involved in this transaction nor is there any connection between Mr. Popik and plaintiff's alleged damages.

The fifth cause of action for legal malpractice alleges that Mr. Popik drafted the August 24, 2000 Letter of Intent, creating an attorney/client privilege; that Mr. Popik failed to exercise reasonable skill and knowledge possessed by a member of the legal profession in representing multiple parties with conflicting interests, and that Mr. Popik failed to inform plaintiff of her right to have independent counsel review and evaluate the Letter of Intent, causing plaintiff to sustain damages - namely loss of ownership and interest in the Avenue D and Avenue I premises. Even liberally construed, plaintiff's claim of damages are bare legal conclusions. Even assuming they vaguely state a claim for damages, the allegation of Mr. Popik's negligence is unequivocally contradicted by documentary evidence. In this regard, plaintiff testified that Mr. Popik's only fault was his assurance to her that Umarova "was a very decent person" whom he had known for 17 years; that he made "this agreement between all of us because this is an agreement among honest people;" and that she had no evidence that Mr. Popik helped Umarova to defraud plaintiff.[FN2] Moreover, even assuming plaintiff sustained damages, she testified that Mr. Popik did not "have anything do to with" Umarova's failure to pay her a certain percentage of interest in the Avenue D and Avenue I premises. Further, plaintiff failed to show how the alleged malpractice caused any such damages since the Letter of Intent was not a binding contract but merely "effectuated the intent of the parties" (Weksler v Kane Kessler, P.C., 63 AD3d 529, 531[2009]).

In light of the foregoing, defendant has demonstrated that the complaint fails to allege that plaintiff would be able to prove that, but for the alleged malpractice, she would have prevailed on her claim that she lost her interest in the Avenue D and Avenue I premises.Stated otherwise, defendant has demonstrated that the complaint fails to state a viable cause of action sounding in legal malpractice and has made a prima facie showing entitling him to dismiss the complaint insofar as asserted against him.

In opposition, plaintiff has failed to raise a triable issue of fact. Plaintiff relies solely upon her 2004 affidavit in which she recounts her dealings with Mr. Popik in the drafting of the Letter of Intent. She states, among other things, that she met with Mr. Popik and five other of the defendants to settle a dispute among them; that Mr. Popik praised Umarova as a trustworthy individual; that Mr. Popik read the agreement and translated it into Russian, with all parties present; and that it was executed by all the parties. Plaintiff [*7]goes on to state that Mr. Popik convinced her and Benyaminova to sign a deed which caused plaintiff to sign over her one-half interest in a parcel of real estate to defendant Losyev; that he notarized the signatures; that he was paid by the parties for his services; and that when, two weeks later, plaintiff told Mr. Popik that she was nervous about the agreement because the parties were not fulfilling their obligations, Mr. Popik agreed to represent her against these parties, but now claims he did not have an attorney/client relationship with her.

Thus, counsel for plaintiff sums up plaintiff's claims as follows: Mr. Popik: (1) represented several parties simultaneously with differing interests; (2) prepared an agreement for said parties; (3) accepted payment for his services; (4) represented plaintiff against another party to the agreement; and (4) caused plaintiff to lose her interest in real property and business. He asserts that "[u]pn entering Mr. Popik's office [p]laintiff possessed real property and a business interest . . .[a]fter she left Mr. Popik's office, [p]laintiff neither had an interest in the real property nor an interest in her business," because Mr. Popik "prepared, notarized and record the documents." Counsel further asserts that "questions of material facts exist as to whether [d]efendant Popik corrupted the attorney-client relationship by representing multiple parties and, in doing so, acted negligently."

As defendant states in his reply, plaintiff has failed rebut his prima facie showing. Stated otherwise, neither plaintiff's affidavit or counsel's affirmation address the elements comprising a cause of action for legal malpractice. Plaintiff fails to identify any breach on defendant's part, or that any alleged breach proximately caused plaintiff to sustain actual or ascertainable damages. To establish causation, plaintiff was required to show that she would not have incurred any damages, but for Mr. Popik's negligence. Plaintiff utterly failed to make any such showing. In fact, she testified to the contrary and, as indicated above, her claims of damages are conclusory. Further, while plaintiff's counsel asserts that plaintiff entered Mr. Popik's office possessing real property and left without such interest, this representation is completely conclusory and devoid of any evidentiary support. Moreover, plaintiff's opposition is bereft of any discussion of plaintiff's deposition testimony, which undermines the allegations of her complaint, including the allegation that she was not advised that she could have the Letter of Intent reviewed by independent counsel. As noted above, plaintiff's only complaint against Mr. Popik was that he represented to plaintiff that Umarova was a very decent person.In sum, plaintiff has failed to rebut defendant's prima facie showing.

Based upon the foregoing, the motion of defendant to dismiss the complaint insofar as asserted against him pursuant to CPlR 3211(a)(7) and CPLR 3212 is granted.

This constitutes the decision and order of the court.

E N T E R [*8]

J. S. C. Footnotes

Footnote 1:See Plaintiff's Affirmation in Opposition, Ex. B.

Footnote 2:Notably, with respect to plaintiff's allegation that Mr. Popik failed to disclose a conflict of interest, "an attorney's failure to disclose a conflict of interest is not actionable absent allegations that such failure proximately caused actual damages" (Unger v Paul Weiss Rifkund Wharton & Garrison, 265 AD2d 156, 157 [1999]).