Messersmith v Tate

[*1] Messersmith v Tate 2018 NY Slip Op 28019 Decided on February 1, 2018 Supreme Court, Warren County Muller, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and subject to revision before publication in the printed Official Reports.

Decided on February 1, 2018
Supreme Court, Warren County

Andrew Messersmith, Plaintiff,

against

Donald Tate, Defendant.



63745



Martin J. McGuiness, Saratoga Springs, for plaintiff.

Corrigan, McCoy & Bush, PLLC, Rensselaer (Scott W. Bush of counsel), for defendant.
Robert J. Muller, J.

Plaintiff is an attorney who represented Ashley Icardi relative to certain criminal charges filed against her in the Village Court of Hoosick Falls in early 2013. Icardi was then struck by a commercial truck in August 2013 and contacted plaintiff to see if he would commence a personal injury action on her behalf. Plaintiff discussed the matter with John Patterson — the attorney with whom he was practicing at that time — and the two agreed to accept the case. Patterson subsequently contacted Robert Becher, an attorney with more experience in personal injury litigation, and an agreement was reached whereby Patterson and Becher would represent Icardi on a contingency basis with each receiving half of any legal fees derived from the lawsuit.

Plaintiff stopped practicing with Patterson in May 2014, taking the Icardi file with him upon Patterson's express consent. Plaintiff thereafter began practicing with defendant under defendant's firm name, Holbrook, Johnson & Tate. According to plaintiff, he was "friends" with defendant and "look[ed] upon [him] as a mentor in the practice of law." As a result, he "entered into a business relationship with [d]efendant without executing a detailed written agreement." With that said, plaintiff states that the two had a verbal agreement whereby "[p]laintiff would receive a percentage of any legal fees earned on new cases in [d]efendant's firm . . . which [p]laintiff performed work on" and, further, that "legal fees for old matters in which [p]laintiff was already counsel at the time he began working with [d]efendant . . . would belong totally to [p]laintiff."

Insofar as the Icardi file was concerned, defendant allegedly directed plaintiff to prepare a new retainer agreement which removed Patterson's name and replaced it with the name of defendant's firm. According to plaintiff, "[d]efendant told [him] that while [the firm] could be placed on [the] new retainer agreement . . . , the case would remain solely [that of p]laintiff[] and . . . all future legal fees would be payable to him alone." This new retainer agreement was [*2]subsequently executed.

Plaintiff stopped practicing with defendant in January 2015, again taking the Icardi file with him. He did not inform Becher that he no longer worked with defendant "because he assumed that in the event [d]efendant received a check for the Icardi legal fees, [he] would remit the total fee to [plaintiff] as agreed." Becher subsequently settled the Icardi matter for $215,000.00, with a total legal fee of $69,949.54. In accordance with the retainer agreement, he sent Holbrook, Johnson & Tate a check for $34,974.77. Defendant then deposited the check into his escrow account and sent plaintiff a check for $17,487.39 — only half of the amount received.

Plaintiff commenced this action in March 2017 to recover the other half of the $34,974.77, asserting five causes of action: (1) conversion; (2) fraud; (3) breach of contract; (4) money had and received; and (5) unjust enrichment. Issue was joined with defendant asserting a counterclaim for an accounting. According to defendant, plaintiff was an employee of Holbrook, Johnston & Tate and, "[a]s part of his employment arrangement . . . plaintiff would receive . . . half of all fees that he brought in with the exception of legal services he performed with the Public Defender's Office." Defendant alleges that "plaintiff failed to provide [Holbrook, Johnson & Tate] with one half of the monies he received for providing services as referee, assigned counsel [and] attorney for the child" and "demands an accounting . . . for services rendered in those capacities . . . ." Plaintiff then served a reply to the counterclaim with general denials. Presently before the Court is plaintiff's motion for leave to (1) amend his complaint so as to add a sixth cause of action for an accounting; and (2) amend his reply to counterclaim so as to add the affirmative defense of laches.

"Pursuant to CPLR 3025 (b), a party may amend its pleadings 'at any time by leave of [the] court,' which 'shall be freely given upon such terms as may be just'" (NYAHSA Servs., Inc., Self-Ins. Trust v People Care Inc., 156 AD3d 99, 101 [2017]; see Kimso Apts., LLC v Gandhi, 24 NY3d 403, 411 [2014]). The Appellate Division, Third Department "previously adhered to a rule requiring the proponent of a motion for leave to amend a pleading to make a sufficient evidentiary showing to support the proposed claim'" (NYAHSA Servs., Inc., Self-Ins. Trust v People Care Inc., 156 AD3d at 101-102, quoting Cowsert v Macy's E., Inc., 74 AD3d 1444, 1445 [2010]). In other words, the movant had "to make an 'evidentiary showing that the proposed amendments have merit'" (NYAHSA Servs., Inc., Self-Ins. Trust v People Care Inc., 156 AD3d at 102, quoting Dinstber v Allstate Ins. Co., 110 AD3d 1410, 1412 [2013]). Recently, however, the Third Department "depart[ed] from that line of authority and follow[ed] the lead of the other three Departments, . . . hold[ing] that '[n]o evidentiary showing of merit is required under CPLR 3025 (b)'" (NYAHSA Servs., Inc., Self-Ins. Trust v People Care Inc., 156 AD3d at 102, quoting Lucido v Mancuso, 49 AD3d 220, 229 [2008]; see Cruz v Brown, 129 AD3d 455, 456 [2015]; Holst v Liberatore, 105 AD3d 1374, 1374-1375 [2013]).

"Thus, the rule on a motion for leave to amend a pleading is that the movant need not establish the merits of the proposed amendment and, '[i]n the absence of prejudice or surprise resulting directly from the delay in seeking leave, such applications are to be freely granted unless the proposed amendment is palpably insufficient or patently devoid of merit'" (NYAHSA Servs., Inc., Self-Ins. Trust v People Care Inc., 156 AD3d at 102, quoting Lucido v Mancuso, 49 AD3d at 222; see Kimso Apts., LLC v Gandhi, 24 NY3d at 411; LaLima v Consolidated Edison [*3]Co. of NY, Inc., 151 AD3d 832, 834 [2017]; Cruz v Brown, 129 AD3d at 456). As stated by the Third Department, "[t]he rationale for adopting this rule is that the liberal standard for leave to amend that was adopted by the drafters of the CPLR is inconsistent with requiring an evidentiary showing of merit on such a motion" (NYAHSA Servs., Inc., Self-Ins. Trust v People Care Inc., 156 AD3d at 102). "'If the opposing party [on a motion to amend] wishes to test the merits of the proposed added cause of action or defense, that party may later move for summary judgment [or to dismiss] upon a proper showing'" (NYAHSA Servs., Inc., Self-Ins. Trust v People Care Inc., 156 AD3d at 102, quoting Lucido v Mancuso, 49 AD3d at 229 [citation omitted]).

Here, defendant has not — nor can he — claim any prejudice or surprise as a result of the amendments sought by plaintiff. Defendant served his answer with counterclaim on July 19, 2017 and plaintiff served his reply to the counterclaim on August 16, 2017. Counsel for plaintiff then sent correspondence to defense counsel on September 11, 2017 requesting that he stipulate to the amendments sought herein. Defense counsel declined and the instant motion was filed less than two months later. The parties have yet to engage in any discovery.

Further, there is nothing in the record to suggest that the proposed amendments are palpably insufficient or patently devoid of merit. Plaintiff seeks to amend his complaint so as to add a cause of action for an accounting, alleging that he did not receive a percentage of the legal fees earned on new cases in defendant's firm that he worked on, notwithstanding his alleged verbal agreement with defendant. He also seeks to add the affirmative defense of laches to his reply to defendant's counterclaim, alleging that defendant never gave him any indication that he would seek a percentage of the legal fees earned by plaintiff as referee, assigned counsel and attorney for the child. According to plaintiff, he "reasonably relied on [d]efendant's failure to assert [these] purported rights and would be prejudiced by the relief sought as any legal fees earned by [p]laintiff during the time he practiced law with [d]efendant have been expended."

The foregoing notwithstanding, defendant contends that the motion must be denied because plaintiff failed to submit copies of the amended pleadings. CPLR 3025 (b) was amended, effective January 1, 2012, to provide that "[a]ny motion to amend or supplement pleadings shall be accompanied by the proposed amended or supplemental pleading clearly showing the changes or additions to be made to the pleading." Patrick M. Connors, Practice Commentaries (McKinney's Cons Law of NY, Book 7B, CPLR C3025:9A), provides the following analysis relative to this amendment:

"[The] new provision does not prescribe exactly how the changes are to be shown, but any document marked with 'track changes,' or some similar program, will likely suffice. Clarity should be the touchstone for any disputes on this front, and there are many ways in which the movant can achieve this legislative goal. [I]t . . . appears that . . . CPLR 3025 (b) requires a party moving to amend or supplement to include the entire proposed amended or supplemental pleading, and not simply those portions that are amended or supplemented."

Here, plaintiff has submitted a proposed amended complaint which sets forth only the proposed "sixth cause of action" and a proposed amended reply which sets forth only the proposed "first affirmative defense." Given the express language of CPLR 3205 (b) — together with the analysis contained within the Practice Commentaries — the Court is constrained to deny [*4]plaintiff's motion for leave to amend. Plaintiff failed to submit the entire proposed amended complaint and amended reply, instead submitting only the cause of action and affirmative defense sought to be added. In this regard, it must also be noted that plaintiff could have easily corrected these defects in his reply papers. He failed to do so, however, instead submitting nothing in reply to defendant's opposition.

Briefly, the Court notes that counsel for defendant has violated Uniform Rules for Trial Courts (22 NYCRR) § 214.12 (1) by failing to redact plaintiff's social security number from the documents annexed to his affidavit as Exhibit "1." The Warren County Clerk is therefore directed to seal Exhibit "1" of this affidavit in accordance with Uniform Rules for Trial Courts (22 NYCRR) § 214.12 (2). Counsel for defendant shall ensure that all of his future submissions to the Court comply fully with Uniform Rules for Trial Courts (22 NYCRR) § 214.12 (1).

Counsel for the parties are hereby directed to appear for a preliminary conference on February 23, 2018 at 10:30 A.M. at the Warren County Courthouse in Lake George, New York.

Therefore, having considered the Affirmation of Martin J. McGuinness, Esq. with exhibits attached thereto, dated November 29, 2017, submitted in support of the motion; and Affidavit of Scott W. Bush, Esq. with exhibit attached thereto, sworn to December 22, 2017, submitted in opposition to the motion, it is hereby

ORDERED that plaintiff's motion for leave to amend is denied in its entirety, without prejudice; and it is further

ORDERED that the Warren County Clerk shall seal Exhibit "1" of the affidavit of Scott W. Bush, Esq., sworn to December 22, 2017, in accordance with Uniform Rules for Trial Courts (22 NYCRR) § 214.12 (2); and it is further

ORDERED that Scott W. Bush, Esq. shall ensure that all of his future submissions to the Court comply fully with Uniform Rules for Trial Courts (22 NYCRR) § 214.12 (1); and it is further

ORDERED that counsel for the parties shall appear for a preliminary conference on February 23, 2018 at 10:30 A.M. at the Warren County Courthouse in Lake George, New York.

The original of this Decision and Order has been filed by the Court together with the Notice of Motion dated November 29, 2017, Revised Notice of Motion dated December 6, 2017 and the submissions enumerated above. Counsel for defendant is hereby directed to promptly obtain a filed copy of the Decision and Order for service with notice of entry upon plaintiff in accordance with CPLR 5513.

Dated:February 1, 2018

Lake George, New York

ROBERT J. MULLER, J.S.C.